Skip to comments.Sale of Federal Mortgages to Investors Puts Greater Burden on Blacks, Suit Says
Posted on 08/15/2016 11:24:11 AM PDT by reaganaut1
For years, the federal government avoided insuring mortgages in black neighborhoods, a practice known as redlining that exacerbated racial divides throughout Americas cities.
Redlining has long been outlawed, but in New York City, the federal government is again disproportionately hurting black homeowners, according to a federal lawsuit filed by a nonprofit that represents low-income New Yorkers. This time, the suit says, the government is fueling racial disparities not through its lending policies but in how it handles foreclosures.
Since the financial crisis pushed thousands of homeowners in New York and across the country into foreclosure, the federal Department of Housing and Urban Development has been selling insured delinquent mortgages to private investors, typically hedge funds and private equity funds, which then collect monthly payments.
The investors, according to the lawsuit filed against the housing agency and a large private equity firm, Lone Star Funds, provide fewer protections to homeowners who fall behind on their mortgage payments than the federal government does, leading to higher rates of foreclosure.
Most of the mortgages being sold to these investors are in predominantly black neighborhoods like in southeast Queens and the Canarsie section of Brooklyn. From 2012 to 2014, more than 61 percent of the government-backed mortgages sold to investors were in predominantly black neighborhoods, according to the lawsuit.
Meanwhile, only about one-third of federally insured mortgages over all were issued in those same neighborhoods.
Lawyers for the homeowners who filed the lawsuit say the concentration of the sales is putting black homeowners at greater risk of foreclosure and threatening to undermine decades of progress toward increasing homeownership in these neighborhoods.
A spokesman for the housing agency declined to comment on the lawsuit. Caliber Home Loans, the mortgage firm under Lone Star, said the lawsuit was without merit.
(Excerpt) Read more at nytimes.com ...
Every time you hear the media express concerns about “race”, just keep in mind that they don’t care about “race”. At all. BLM don’t care about it. Obama doesn’t care about it.
“Race” is a tool for advancing Marxism. Nothing more.
Oh come on. Mortgages are a “pay to play” product, too.
Lost me right there. The government did not refuse to insure mortgages in black neighborhoods, they refused to insure mortgages to people who could not afford to pay them. The "redline" was economic, not racial or geographic.
Just anther part of the fuel to incite obummer’s and illary’s race war!-)
Investors will want their money back.
Boy,the NYT third graders are getting petulant.
Sun goes down, blacks most affected.
Sun comes up, blacks most affected,
Howz about “Shitty culture, blacks most affected.”
Sorry, but dats da twuth.
No, not race, but attitude and practice.
Put that in your Obamaholes and fart it, NYT.
I'm not sure why you used a sarcasm tag here, that's *exactly* what they think.
You are racist if you don’t make loans to folks who won’t pay them back, and you are a bigger racist if you do make the loans to folks who don’t plan on paying them back, and try to cut your losses.
Since redlining has been stopped, everybody else has been paying more for loans to cover black defaults. They never stop complaining.
Investors deserve to lose..If they haven`t learned by now that dems will screw investors to keep their voters happy,then it`s the investors fault.
Federal mortgage policy hurts blacks. Women and children hardest hit.
Not factually true. The inner city had middle class and rich people living as a minority beside the working class, working poor and welfare poor. FHA and other agencies explicitly told Banks and mortgage companies they would not guarantee in the middle of the inner city, even for rich and middle-class types with good credit ratings.
HUD undersecretary Msgr Geno Baroni tried to change that in 77-81 He created the monster that collapsed in 2008.
Even after they destroy billions of dollars of wealth in this country (which is their goal) they won't stop with this CRAP of giving loans to people who CANNOT PAY THEM BACK.
It all goes back that POS Franklin Roosevelt and his cronies who thought that owning a house and land is a RIGHT, not something to be earned.
Here we go again.......
Yep. Community Reinvestment Act of 1977.
The same CRA conditions exist now. No law was enacted to end them.
Yes. Just like Social Security. And all that other similar spawn.
Msgr Geno Baroni is also the Alinskyite who created the current structure of Baltimore. When you see the mayor, the prosecutor, etal saying and doing stupid things, remember they grew up learning what Msgr Baroni taught them.
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